Hello! BlockTalkers & Blockchain Enthusiastic!
We recently hosted one AMA with Stealth, on 25th March 05.00 PM UTC. Many of you might have participated or many of not. But we make sure no one missed out from the knowledge shared by James Stroud, Lead Developer & Co-Founder at Stealth. So here we are up with AMA transcript, for those who missed the live session, this blog post will be saver & feeder of knowledge for them.
Introduction Question Asked By BlockTalks
Q1. Can you introduce yourself to the community? What’s your position on Stealth?
Ans — My name is James Stroud, and I am the Co-Founder and Lead Developer for Stealth R&D LLC, a company that is dedicated to developing the Stealth cryptocurrency protocol and building infrastructure for it as well.
Q2. What was your motivation for starting this project? and what is your vision for Stealth?
Ans — Stealth was launched in 2014, just to put my answer to this question in perspective. 2014 was about the time that the term “alt-coin” was invented, as prior to that there were only a few cryptocurrencies other than Bitcoin. For example, Ethereum had not launched yet.
My motivation to create Stealth at the time was to create a private, usable cryptocurrency. By useable, I mean that it needed to have fast transaction times, scale well, but also have cryptographic privacy.
This is still my vision and we work towards it every day. We have come a long way.
Q3. What are the major milestones Stealth achieved so far & what’s are in future pipeline?
Ans — When Stealth was launched, it wasn’t much different from Bitcoin, except Stealth was proof-of-stake, while Bitcoin was proof-of-work. Since then we have done a lot, and I’ll mention some milestones right now, explaining their significance.
First, when we launched we were different in that we incorporated the Tor network into the client by default. This was different from Bitcoin, where privacy had not yet been recognized as a critical feature of cryptocurrencies. Tor is an obfuscated network routing protocol, that protects the geolocation (IP address) of network nodes.
Shortly after, we invented StealthText, a technology that enables secret transactions over SMS (the phone texting protocol). Some of StealthText’s features were that we had an app on the play store, all information for a transaction was hidden in transit over SMS, and the message to convey the transaction details used bank-grade encryption with authentication, meaning no one could even modify transaction details blindly without such tampering being detected. The idea about this type of authentication (called message authentication) is that you could send your information over an unsecure protocol (SMS) and you know it could get to the other end untampered.
For StealthText, we also had what is known as StealthRelay, that could relay the message to a wallet client undisturbed, so that the transaction could get broadcast to the Stealth network (running on Tor). StealthText was very cool, but never caught on because shortly after smartphones became very popular, making SMS somewhat of a legacy protocol. For example we are chatting here in Telegram, not using SMS. We had several innovations since the early days, but I’ll skip to our most recent and, to me, most exciting technology called Junaeth.
Junaeth is a high performance blockchain protocol designed with several objectives in mind.
The first objective is to have 5 second blocks. Where every transaction is confirmed (and spendable) in 5 seconds or less. The second objective is that the protocol is scalable for global usage, meaning it could carry thousands of transactions per second. The third objective is that the transactions thereon can be completely cryptographically private.
It’s the most ambitious mix of objectives for any blockchain, but we believe this mix is going to be critical for cryptocurrencies if they are to have global adoption. We call this mix “The Holy Grail of Crypto”: fast, feeless, private, scalable transactions.
Question Asked in Twitter For Stealth!
Q1. What are the advantages long term investors will get for holding $XST token?
Ans — So, the design of XST is such that simply holding XST does not confer any special benefits upon the coin holder. For example, it doesn’t earn interest or anything like that. It might be compared to Bitcoin in this way. However, there is some chance that the money supply could shrink because people will be able to purchase StealthNodes. The purchase price for StealthNodes is destroyed (no person receives them), shrinking the money supply, and potentially making XST more valuable because of the reduced money supply.
Also, the Junaeth protocol is incentivized in such a way that inflation will be very small, just 1% inflation every year, before compounding, which happens every block. This means that users will not see exorbitant value erode from their XST holdings because of inflation.
We hope, although there is no way to guarantee, that value may go up because XST is increasingly adopted because of its properties.
Q2. How seriously Stealth is taking cryptography & Blockchain? What advantages you have apart from other technologies?
Ans — The short answer is we take cryptography VERY seriously.
The most basic goal of Stealth is to be a cryptographically private cryptocurrency.
In fact, though we launched with that goal in 2014, nearly 6 years ago, we have yet to finalize our privacy protocol. Only recently have we settled on zcash, because we believe it is finally well vetted, having itself been in use for 3 years. Several potential exploits have been found and patched for the zcash protocol, with no new ones popping up. The cryptography community now has a body of experts that are constantly studying it. We think it is now safe to use.
No other privacy coin, I believe, has had this level of caution before picking a privacy protocol. I could go into some examples, but there have been several exploits. I would note that even the zcoin protocol has been abandoned because the exploits were irresolvable. The advantages of zcash are numerous. Most importantly, proof validation can be very fast and proofs can be very small. Making it useful for a fast, scalable blockchain. Additionally, it has the highest levels of privacy, hiding sender, receiver, and amount. Also, it is an asynchronous protocol.
By comparison, the now famous “mimblewimble” protocol requires both sender and receiver to coordinate a transaction. This is not ideal at all, for obvious reasons. If person A wants to send person B a transaction, person A should be able to do that any time they want. Before I wrap up this question, I want to touch base on this one shortcoming of mimblewimble privacy.
For example, if you can figure out a way to monitor the available of participants in a network, you can make a table of sorts that shows when two participants are engaged in the network. If you have this table you can correlate it to the transaction times, meaning you can de-anonymize transactions through a so-called “timing attack”.
Although mimblewimble necessarily has this vulnerability, zcash (Stealth’s privacy protocol) does not. There are many other advantages of Stealth’s choices of protocols, and especially cryptography.
Q3. DeFi is a hot niche that currently occupy the cryptospace do you have any idea to implement DeFi in your platform?
Ans — Wow, I wish I knew what DeFi was. I’m guessing “decentralized finance”, meaning the ability to make loans on the blockchain. I’m going to assume that’s what it means. I don’t have time to google the term right now.
With that caveat, I will say several aspects of Junaeth’s design allows for a very sophisticated XST economy.
For example, StealthNodes (the autonymous, anonymous block validators of the Stealth’s Junaeth protocol) can server as blockchain oracles. One type of service we are in the early stages of developing is that they will be random oracles. Using a protocol supported by NIST, each five second block will include a random number that can have various uses on a blockchain. A very simple (though perhaps not advisable) use is a blockchain lottery that utilizes these random numbers. I don’t have time to describe how the oracles work, from a technical perspective, but the fact that they are possible means that much more is possible on the blockchain.
For DeFi (as I am guessing it means), StealthNodes could serve as “trusted” entitites to manage sidechains where loans are possible, etc.
Q4. How does Junaeth work & why Stealth choosed Junaeth Blockchain technology?
Ans — Fundamentally, at the heart of it, Junaeth is a scheuled block protocol. It has several facets.
First, is block scheduling. The way this works is there is a queue of block signers, each having 5 seconds to sign a block before they miss their opportunity. This means that if the chain has full participation by StealthNodes, users can be confident that their transactions will be confirmed within 5 seconds, faster than a credit card transaction confirms, typically.
Second is that StealthNodes are nonfungible blockchain assets that are purchased outright. These assets represent irrevocable rights to sign blocks, in perpetuity.
Also, because StealthNodes can be bought with “anonymized” coins and the network routing obfuscated by Tor, StealthNode operators can be completely autononmous, as I mentioned above.
Third, also, as I mentioned above, the network uses asynchronous distributed timekeeping. So, although this type of network timekeeping does not rely on the internal clocks of all the nodes being synchronized, the blocks themselves are highly regular, as an emergent property of the timekeeping protocol.
Fourth, Junaeth is the only high performance blockchain that uses UTXOs (unspent transaction outputs). These are like travelers cheques. I can’t go into the technical reasons for the significance because of time, but UTXOs allow for cryptographically anonymous transactions.
Fifth, Junaeth uses a hybrid ledger design that minimizes pollution of the blockchain with housekeeping UTXOs. All block validators use a separate account-based ledger that is kept in RAM on each node, and are only allowed to move funds from this account-based ledger to the UTXO set once per day. It is highly efficient.
Q5. What is the project’s strength and which potential Stealth have which will make Stealth a highly usable payment system?
Ans — Well, I believe I have answered this one, so I’ll use it for a recap.
The project’s main strength now and going forward is our unique block validation protocol called Junaeth. As I have describe above, it has the capacity for 5 second blocks, completely cryptographically anonymous transactions, a highly scalable structure, and services like block like blockchain oracles and sidechains.
I should note, since you posted the link to our white paper, that Junaeth used to be called “Quantum Proof-of-Stake”. We are in the process of updating all our materials to reflect this name change.
Since I have written so much above regarding the advantages of Junaeth, I’ll finish with this question here.
Question Asked by our BlockTalks Community Members during live Session to James Stroud
Q1. I read an article by you that said “Junaeth, formerly termed” qPoS “, is a unique reputation …” what you mean when you talk about unique reputation, what is it?
Ans — Oh yes, great question. I forgot to describe the reputation system above. It is a critical element of the Junaeth protocol.
Each StealthNode block validator has a reputation that increases every time they sign a block (have SUCCESS in their duties according to the queue). The reputation decreases every time they FAIL sign a block. The reputation, called “weight” changes according to this formula:
weight = square_root(SUCCESS-FAIL)
Weight has two important consequences. The first is that block rewards go up linearly and proportionally with weight. The second is that the chain trust goes up linearly with weight, so if the network splits, the chain of the network with the highest total weight will eventually be chosen as the winner.
Q2. Privacy blockchains have promoted money laundering and criminal sponsorship, how do you tackle this?? What procedure will be required of me to access a transaction information, even though I’m not a government agency, is it even possible?
Ans — There are two competing forces in this world. Freedom and security. They are at odds. More freedom means less security. You can NEVER escape this fact.
There are many famous quotes about this conflict, but one I embrace personally is “those who would sacrifice liberty for security deserve neither liberty nor security”.
Blockchain itself, with bitcoin, was arguably founded on this idea. The concept was to forego central banks, who have the power to inflate the money supply and use this mechanism of inflation to transfer wealth to those already rich, and from those not rich. Instead Bitcoin and other cryptocurrencies rely on a protocol (voluntarily accepted by network participants) to manage the money supply. This so-called “trustlessness” is arguably the reason that people put value in Bitcoin.
Personally, I completely unequivocally embrace the concept of liberty as it applies to money. Money is property. The architects of the political systems in the USA, and other free countries described inalienable rights in terms of life, liberty, and PROPERTY. Currency is property, and so it should embody liberty.
Privacy is a fundamental expression of liberty. It is a prerequisite for liberty. It is indispensable for liberty.
There is no plan to “tackle” liberty in any form for Stealth. There is no procedure to break the anonymity. The choice of anonymous technologies specifically precludes any attempt to break the anonymity.
With that said, if you have a philosophical problem with liberty, or desire more security, then XST is not for you. You are FREE to exercise this option.
Q3. Why is Zerocash protocol better when users do small transactions? How does it preserve privacy?
Ans — We have spent several years studying different privacy solutions. We have decided recently that zerocash (which I call zcash often), is the best option for a fast, feeless, private, and scalable blockchain. I mentioned the reasons above, but I wanted to answer this question to highlight the fact that the choice of protocols is important. The question is unique in that the user mentions application to small transactions, so is worth consideration as a winner.
Briefly, proofs in zerocash are small, and they do not take much computational power to validate, making them ideal for not only fast transactions but small transactions.
Conceivable, the proofs are also prunable after a certain amount of time, making blockchain bloat less of an issue.
The only downside of zerocash proofs is that they are computationally expensive to create. This could inhibit use of zerocash for small transactions, but the cost of the computational power is typically going to be negligible even compared to small transactions, and the proofs themselves constitute a type of proof-of-work that keeps spam to a minimum.
Additionally, if a user has a small transaction and is not interested in anonymity, they can use XST (the non-private currency on the blockchain). Sending XST (as opposed to XSS, the private currency), does not require a zerocash proof.
I should note that our zerocash protocol is under development and not on mainnet yet
Q4. If users can buy StealthNodes and manage them, what does it mean that users can’t sign blocks?
Ans — StealthNodes are expected to sign every block for which they are scheduled in the queue.
However, people can suffer power outages or service providers (like VPS providers) can take their own nodes offline.
In these cases, the nodes can’t sign blocks and the StealthNode will miss blocks, reducing their reputation.
Q5. Why unspent transaction outputs (UTXO) are important for the Stealth infrastructure and what contribution does it provide for privacy?
What role does UTXO play to hide both the sender and receiver of each transaction?
Ans — A UTXO is like a traveler’s cheque. To send money in a UTXO system, you take an unspent “cheque” someone has sent you, say for 100 XST (as an example).
Let’s pretend person A has this unspent cheque (UTXO) for 100 XST and wants to send 90 XST to person B. This means that person A will need 10 XST as change (let’s ignore fees for the sake of this example!).
So Person A signs the 100 XST unspent cheque, and creates two (2) new cheques, one to person B for 90 XST, and one to himself (person A) for 10 XST. Both of these new cheques are unspent, and in the process person A has spent the 100 XST cheque. That’s UTXO in a nutshell, by example.
How does this enable privacy?
Well, imagine that you can hide exactly which UTXO person A signs. Imagine a protocol where amounts are not hidden, there could be 20 UTXOs for 100 XST. If you could come up with a cryptographic system such that person A could sign one of them, but hid which it was, you’d have an anonymous transaction protocol. Monero’s cryptonote protocol works this way.
Now, imagine you had a cryptographic way to also hide the amount of every UTXO. This means person A could sign any transaction on the blockchain, vastly increasing the anonymity set.
This is how zerocash works.